Hull & Machinery Insurance
Marine Hull and machinery insurance covers loss or damage to hull and machinery. The hull is the structure of the vessel which can be made from wood, steel or any other type of materials and equipment such as pulley, crane and steering wheel. Machinery is the equipment that generates the power to move the vessel and control the lighting and temperature system such as boiler, engine, cooler, and electricity generator.
What is Protection and Indemnity insurance (P&I)?
Protection and Indemnity (P&I) insurance is liability coverage for watercraft. It protects the insured from liabilities, from bodily injury, or property damage arising out of the use, or ownership of declared vessels. There are several commonly used protection and indemnity forms and many proprietary forms used for this insurance. Most P&I forms offer payments for loss of life, injury, illness, hospital, and medical expenses.
What is war risk insurance?
War risk insurance is a type of insurance which covers damage due to acts of war, including invasion, insurrection, rebellion and hijacking. Some policies also cover damage due to weapons of mass destruction. It is most commonly used in the shipping and aviation industries. War risk insurance generally has two components: War Risk Liability, which covers people and items inside the craft and is calculated based on the indemnity amount; and War Risk Hull, which covers the craft itself and is calculated based on the value of the craft. The premium varies based on the expected stability of the countries to which the vessel will travel.
What is marine general liability insurance?
Marine General Liability Insurance is important in today’s litigious society, even small mishaps can result in large lawsuits. This holds especially true in the maritime and commercial diving industries. That’s why General Liability Insurance, along with Property and Worker’s Compensation Insurance, is essential for most companies. Liability insurance protects the assets of a business when it is sued for something it did (or didn’t do) to cause an injury or property damage.
Under a General Liability Insurance policy, the insurer is obligated to pay the legal costs of a business in a covered liability claim or lawsuit. Covered liability claims include bodily injury, property damage, personal injury, and advertising injury (damage from slander or false advertising). The insurance company also covers compensatory and general damages. Punitive damages aren’t covered under general liability insurance policies because they’re considered to be punishment for intentional acts.
Marine General Liability Insurance policies always state a maximum amount that the insurer will pay during the policy period. Usually these policies also list the maximum amount the insurer will pay per occurrence.
Example, if a company has a $1 million occurrence cap in its liability policy and it’s successfully sued for $1.5 million, the insurer would pay $1 million and the business would be responsible for paying $500,000.
To cover these types of situations, many companies purchase an Excess or Umbrella Liability insurance, which picks up where their General Liability coverage ends. Umbrella Liability covers payments that exceed their other policy’s limits, and provides additional coverage for liabilities not covered in a standard liability insurance policy.
Policy premiums are typically based on estimated annual gross receipts and the nature of your business. A number of insurance carriers are available to provide General Liability.
The General Aggregate Limit is the most money the insurer will pay under a certain coverage for all claims occurring during the policy term.
Coverage is provided for damages arising out of ownership or occupancy of the insured premises when not maintained in a reasonable manner. This also covers damages arising out of operations performed by the insured business.
Products coverage is provided for damages arising out of products manufactured, sold, handled or distributed by the insured. Completed Operations covers damages occurring after operations have been completed or abandoned, or after an item is installed or built and released for it’s intended purpose.
MEDICAL EXPENSE LIMIT
Medical payments coverage pays medical expenses resulting from bodily injury caused by an accident on premises owned or rented by the insured, or locations next to such property, or when caused by the insured’s operations. These payments are made without regard to the liability of the insured.
FIRE DAMAGE LIMIT
The fire damage limit provides coverage for fire damage caused by negligence on the part of the insured to premises rented to the named insured. If a fire occurs because of negligence of the insured and causes damage to property not rented to the insured, coverage would be provided under the occurrence limit.
Personal Injury means injury other than bodily injury. Coverage is provided for injury resulting from offenses such as false arrest, malicious prosecution, detention or imprisonment, the wrongful entry into, wrongful eviction from and other acts of invasion, or rights of private occupancy of a room. Coverage for libel and slander is also provided in the policy.
This coverage pays for damages done in the course of oral or written advertisement that disparages, libels or slanders a person’s or organization’s goods, products or services. Coverage for these offenses is provided under advertising injury coverage only if they occur during the course of advertising the named insured’s own goods, products or services.
Each occurrence is considered to be an accident, which could include continuous or repeated exposure to the same harmful conditions. An occurrence can also be a sudden event, or a result of a long term series of events.
What is a 'Bumbershoot Policy?
The Bumbershoot policy is a specialized form of excess liability insurance targeted to the maritime industry. These policies cover a company for hazards in limits that exceed the underlying liability policy. The Bumbershoot coverage most often adds to the protection from an umbrella liability policy.
Policies cover dry and wet incidents or nonmarine and maritime activities.
A Bumbershoot insurance policy is a specialized business umbrella insurance coverage. The product protects a business from the risks explicitly associated with wet and dry maritime industry.
Like an umbrella policy, Bumbershoot policies provide a broader level coverage, expanding the underlying primary commercial lines insurance policies.
Commercial lines insurance include coverage specific to the industry as well as general workers compensation insurance, general liability insurance, bodily and property damage, and litigation coverage. Commercial lines protect businesses against potentially devastating financial losses caused by accidents, lawsuits, natural disasters and other adverse events. Premium costs will vary by business type, size, location, and coverage levels.
Designed with marine risks in mind, a Bumbershoot may offer coverage for unique expenses related to collision and salvage as well as liability coverage that meets the standards set by the Longshoreman and Harbor Workers’ Act. Shipyard workers face exposure to heavy equipment, hazardous chemicals, electrical shocks, and slips and falls. Occupational Safety and Health Administration (OSHA) finds that the injury and accident rate is more than twice the rate than in construction or general industries.
Not only international freight shippers could use a Bumbershoot policy. Other business use includes that by shipyards and stevedores, charter vessels and marinas, as well as shipyards and terminal operators. A business involved in maritime services must assess risks when selecting insurance.
Policies also may include
- Worldwide coverage for acceptance and support around the globe
- Environmental liability for spills or accidents which can happen at the dock, and at sea
- Loss or damage of cargo during transportation
- Pay expenses before the processing of a claim through pay on behalf of features
- Personal injury coverage for workers and passengers,
- Captive and hijacking situations
- weather incidents
Bumbershoot policies act as a fail-safe as it adds to the protection provided through regular policies. The premium for a Bumbershoot policy may be less expensive if purchased from the same insurer.